"Therefore hear the word of the Lord , you scoffers who rule this people in Jerusalem. You boast, 'We have entered into a covenant with death, with the realm of the dead we have made an agreement. When an overwhelming scourge sweeps by, it cannot touch us, for we have made a lie our refuge and falsehood our hiding place.'" NIV translation
This passage speaks both of Jerusalem's past and its future. In their past, they made a deal with Egypt in hopes of being saved from invasion and they would even go so far as to make a deal with the Babylonians who would later capture and destroy Jerusalem. The leaders of Judah thought that they could avoid God's judgment by making this deal with those who did not know God.
The passage also speaks of the coming deal that will be struck between God's people and the anti-christ which is described in Daniel 9:27 and by John in Revelation 6. God had made an example out of the northern kingdom for the kingdom of Judah but, instead of repenting and turning back to God, they cut a deal with the enemy in hopes of surviving as a nation.
The history of Judah and Jerusalem serves as an example to us today but, as we see, the lesson will not be taken to heart and a "peace deal" will once again be signed with the enemy.
"So this is what the Sovereign Lord says: 'See, I lay a stone in Zion, a tested stone, a precious cornerstone for a sure foundation; the one who relies on it will never be stricken with panic.'" NIV translation
Isaiah has pointed out that religious rituals and deals with the world will not bring real peace but, now, he shares the solution to the problem which is Jesus Christ. Although it was all in the future to the people that Isaiah was sharing it with, we can look back and clearly see that it is Jesus. The Hebrew word that is translated as panic here is "chuwsh" and it means to hurry. This verse speaks of the fact that true peace is through Jesus alone and those that have His peace will not make deals with the world.